Fully-realised sages and philosophers, after years and years of intense meditation at high mountains, have revealed to us that money is not everything in life. But those living in hilly forests amidst wild animals, which don’t understand money, couldn’t be expected to say anything else. On the other hand, if you ask thinkers and saints, who dwell amidst us in our every day surroundings and who are much more practical, you are likely to get a different response: ‘In this life, money isn’t everything’. They may also probably bill you for sharing this wisdom with you.
What were you thinking? You expected them to come right out and accept the fact that this is a material world and money is what speaks? Ha. Ha. Ha. Don’t be naïve. It is because you think in such a manner that you don’t make any money, whereas your austere and ascetic rishis are already making it to the Forbes Billionaire Club.
So, this week’s subject is how to make money. The most popular way to it today is through a VC-funded tech startup, delivering services/products through an app. And the first two paragraphs are a good example of how to begin your presentation to the VCs.
If you look closely at the intro paragraphs here you will notice they are extremely — pardon us for tooting our own horn — extremely vague and even pointless. This usually makes a smart impression with the VCs, who always love a fellow bullshitter. They may even high-five you at this juncture.
But hold on! Intros aren’t just trailers, what you need is a solid working plan for your business. And it is here, you will do well to understand that the VC market works on merit, where only fresh and original ideas get noticed. But also remember, it is the sillier ones that actually get all the funds.
And before you move on to the business end of your presentation, you must be smart enough to bring up what is the market condition like and how the existing players, if any, are performing and present them all in a profusion of venn diagrams, pie-charts and tabular columns and rows. This is a popular method because 1) It allows the presentation to look smart 2) More importantly, no one can as much make a guess on what is sought to be conveyed. The management school rule on this is: Why put in simple words that which can be confused through an array of symbols and diagrams.
Wrong method: One plus one is two.
Right Method: One—>One—>Mathematics—>Process—>Result—>Two
As you can see, in one small step, a seemingly innocuous idea has been dramatically transformed to convey a bigger truth, which is: the one who did this is a total moron.
But sooner or later you have to get down to your actual business plan, and suppose your idea is to — if this is not your idea, we suggest that you or your friends embrace it as it has a huge chance of succeeding — sell groundnuts through high-end technology-driven apps, you must not tamely say that you want to sell groundnuts via phone apps.
The whole business plan, you must begin confidently, is to empower the humble farmer, reward the small retailer and satisfy the urban customer by seamlessly integrating them under one technological ecosystem that is both accessible and acceptable at all ends of the user chain.
And just as the jaws begin to drop, without ado you must quickly break down the whole business plan in a series of slides:
Fact One: Everyone likes groundnuts.
Fact Two: Everyone watches TV.
Fact Three: Everyone likes to munch on groundnuts while watching TV.
Fact Four: TV can be watched at a touch of a button at homes.
Fact Five: Groundnuts can be ordered at the touch of a mobile app.
Fact Six: We are here to make the previous statement true (Rim shot).
And with that you have to move for the kill with the financials:
Present Market: One packet of fried groundnut sells for Rs.10.
Vendor’s margin per packet: Rs. 5
Sale on a single evening: Around 50 packets.
Seller’s takeaway: Rs.250.
Now, you have to ‘scale’ — this is an important word and if you don’t use it even once, the VCs will leave abruptly leaving you to pay the hotel bill including for beer — this up to your business plan.
Average daily sale of groundnuts via app (in one city): 50, 000.
Profit per day: Rs. 2, 50, 000
Profit per month: Rs. 75, 00,000.
Profit per month when business expanded to 10 more cities: Rs. 75,000,000.
Profit per month when 100 cities are serviced: Rs.7,500, 000, 000
And before you wind up, there is the small matter of naming the app.
Quite simply you can opt for: Groundnuts. But that would be a major boo-boo. Groudnutz would sound cool. But it is still not chic as it contains what is an anathema to the market: Way too many vowels. So your name has to be: GrndNutZ!
There is no way this business can go bust. And even as you get ready to take a bow, your closing slide has to be:
Final Target: Takeover by Google!